Pound jumps to highest in two months


EU’s Juncker thinks a Brexit deal is possible by 31 October
Newsfeed20 Sep 2019
Photo credit: AFP Photo


Market news selected by the DBS Chief Investment Office

 

The pound surged to the highest level in two months against the greenback amid a report that European Commission President Jean-Claude Juncker thinks a Brexit deal can be reached by 31 October.

Sterling rose by as much as 0.7% to USD1.2560, the highest since 15 July, before closing up 0.43% to USD1.2526. The currency outperformed most G-10 peers after Sky News reported that Juncker said in an interview that he was doing “everything” to prevent a no-deal Brexit, which would be “catastrophic”.

Juncker’s comments came on the back of positive sentiment earlier in the day. Irish Prime Minister Leo Varadkar said he would meet his UK counterpart Boris Johnson next week in New York “to try and get a deal” on Brexit, amid some tentative signs of progress in efforts to break the impasse over the Irish border.

Negotiations around Brexit have been stuck for months with little sign of movement as the October deadline looms for the UK to leave the European Union – with or without a deal.

Traders are hanging on every word that is said as they try to ascertain if an economically damaging crash-out scenario can be averted. The positive noise around efforts to forge a deal for now is just rhetoric that can be interpreted either way. Juncker himself said Wednesday (18 September) that a risk of a no-deal Brexit was “palpable”. – Bloomberg News.

The US Dollar Index (DXY) retreated 0.29% to 98.272 on Thursday, the euro rose 0.10% to USD1.1041, and the yen strengthened 0.40% to 108.02 per dollar.


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